Williams v. Everett

Decision Date01 October 1917
Docket NumberNo. 18271.,18271.
Citation200 S.W. 1045
PartiesWILLIAMS v. EVERETT et al.
CourtMissouri Supreme Court

Appeal from Circuit Court, Greene County; Guy D. Kirby, Judge.

Action by Thomas E. Williams against R. E. Everett and another. From a judgment for plaintiff, defendants appeal. Affirmed.

The petition was filed in the Greene County circuit court April 26, 1912, and is as follows:

"Thomas E. Williams, Plaintiff, v. R. E. Everett and Springfield Planing Mill, Lumber & Construction Company, a Corporation, Defendants.

"Plaintiff states that the defendant Springfield Planing Mill, Lumber & Construction Company is a corporation, organized and doing business under the laws of the state of Missouri, with a capital stock of $80,000, divided into 800 shares of the par value of $100 each; that defendant Everett is the president of said company and the managing director thereof.

"Plaintiff states that heretofore, to wit, on the 11th day of February, 1911, he was the owner of 80 shares of said capital stock of said defendant corporation, of the par value of $8,000, and of the reasonable value of $12,000; that plaintiff at, to wit, on the said 11th day of February, 1911, and at divers dates prior thereto, at the office of said company, demanded of defendants that said company issue to plaintiff certificates of said stock, and demanded of said company and of its officers that plaintiff be recognized as a stockholder of said company, and be permitted to enjoy the dividends, benefits, and rights belonging to him as such stockholder, but that the defendants, for the purpose of causing plaintiff to lose said interest in said company and for the purpose of converting same to their own use, wrongfully refused and failed to issue to plaintiff certificates of said stock, and wrongfully failed and refused to allow plaintiff to enjoy the benefits and rights of a stockholder in said company, and wrongfully converted said stock and plaintiff's interest in said company to their own use and benefit; and that plaintiff has been damaged thereby in the sum of $12,000.

"Wherefore, the premises considered, plaintiff prays judgment against the defendants for said sum of $12,000, and for his costs."

The answer was a general denial.

At the trial it appeared that the defendant Everett had at the time of the trial been engaged in the lumber business in Springfield about 30 years under the name of the "Springfield Planing Mill, Lumber & Construction Company." Plaintiff, in 1888, at the age of 17 years, entered his service in the yard as a laborer, and continued in that capacity until about 1900, when he was taken into the office, where he remained until the concern was incorporated in February, 1908. The business was prosperous, and for a number of years he had a contract with his employer for a bonus, in addition to his salary, of 10 per cent. of the excess of the net profits over $5,000 for each year.

Articles of incorporation were filed with the secretary of state by the name of Springfield Planing Mill, Lumber & Construction Company. The articles stated the capital stock to be $80,000, divided into shares of $100 each, all "bona fide subscribed and actually paid up in lawful money of the United States, and is in the custody of the persons hereafter named as the first board of directors." The stockholders signing as subscribers to the articles and number of shares subscribed by each were: R. E. Everett, 550 shares; T. E. Williams, 150 shares; K. W. Everett, 50 shares; and I. N. Everett, 50 shares. The two last named were respectively a son and daughter of R. E. Everett. The first three subscribers named were constituted the board of directors for the first year. The certificate of incorporation was issued February 4, 1908. The first meeting of the corporation was held in August of that year, at which R. E. Everett was made president, at a salary of $1,800 per year, K. W. Everett was made vice president, at a salary of $1,200 per year, and the plaintiff was made secretary and general manager, at a salary of $1,500 per year.

During the five years from 1903 to 1907, inclusive, the plaintiff was employed by defendant Everett under yearly contracts in writing. The first four years his compensation was fixed at $100 per month and 10 per cent. of the net earnings over $5,000 for the year, and 20 per cent. on the amount of net earnings over $10,000. The salary for each succeeding year, including 1907, was fixed at $125 per month, with the same percentages. These contracts for percentages ceased with the incorporation.

Plaintiff testified that the question of incorporation, and his own interest in the business, was discussed from time to time during the years immediately preceding that event, and that it was finally decided that he should have $5,000 of stock in the corporation absolutely, and $1,000 more for each of the following five years. He was also to have the privilege of purchasing, during that time, 50 shares at par. This privilege he afterward surrendered on account of a difference or misunderstanding with Mr. Everett.

The defendants introduced in evidence the following writing:

"Distribution of Stock and Agreement.

"For good will and other conditions herein named, I give to Tom E. Williams 50 shares or $5,000.00 stock.

"For good will and conduct becoming a son as a member of the company, I give K. W. Everett 50 shares or $5,000.00 stock.

"For good will, love, and affection, I give to Irene N. Everett 50 shares or $5,000.00 stock.

"I further agree to give Tom E. Williams 10 shares or $1,000.00 stock every year for five years, provided he remain with the firm, and gives the business his very best ability, and at all times instructs my son or sons in all parts of the business to the end and purpose that they may become thorough business men, in all the different parts and branches of our consolidated business as proposed in our charter and new organization, viz.: Planing mill, lumber, contracting, etc. Should Tom E. Williams choose to sever himself from the firm before the end of five years dating from January 1, 1908, for any other reason than permanent sickness or by his death, he shall forfeit to me all of the above amounts the date he separates himself from the firm, and this contract shall be void and end. He, Tom E. Williams, shall be entitled to the earnings of his shares at the end of each year as they become his shares by his complying with the above conditions, and further, he, Tom E. Williams, shall have the privilege of buying 50 shares, or $5,000.00 stock, at par any time within the next five years from the above date, making a total of $15,000.00 stock, or 150 shares.

                                 R. E. Everett."
                

He testified that this was read at the directors' meeting August 27, 1908, and was satisfactory to Mr. Williams. Mrs. Johnson, formerly Miss Irene N. Everett, also testified to its reading at the meeting, but did not testify that it was shown to her, nor that the provisions in question were in it.

Mr. Williams denied that he had ever seen the paper until the trial, and denied that there was any arrangement or agreement between them concerning the forfeiture of the stock. He testified that by his agreement the 50 shares were to accrue to him in installments as stated in the paper.

The stock of the corporation was at the time of its organization to be fully paid for by the transfer to it of all the property, real and personal, used by Mr. Everett in the business, which was valued by them at eighty-two thousand and some odd dollars. A large part of this was in real estate which had not, at the time of the trial, been transferred to it.

The defendants asked at the close of all the evidence that the jury be instructed to find for them respectively, which was refused, and defendants excepted. Thereupon the court, at plaintiff's request and against defendants' objection, gave the following instruction, to which exceptions were duly saved:

"I. The court instructs the jury that the defendant Springfield Planing Mill, Lumber & Construction Company is a corporation organized under the laws of the state of Missouri by articles of association duly executed by R. E. Everett, Thomas E. Williams, K. W. Everett, and I. N. Everett on the 24th day of January, 1908, and certificate of the secretary of state regularly issued thereon on February 4, 1908, and that from and after said February 4, 1908, said corporation was fully completed and established as a corporation with all the rights and liabilities of a corporation under the law and as mentioned in these instructions.

"The capital stock or stock of said corporation consisted of a portion or all of the plant and business theretofore owned and operated by defendant R. E. Everett as a planing mill and lumber company, the portion of said business so taken as and for the stock of said corporation being taken and accepted by it at a valuation of $80,000, and in this connection it is a question for you to determine from the evidence whether the corporation took all of the assets of said former business, or all of said assets less $6,000. Whichever way you may find that fact to be, however, for the purpose of this case you are to consider that the company owned the assets constituting its stock regardless of whether or not proper transfers had been made to it of said assets, and that all of said stock was fully paid in. By the articles of association organizing said corporation it was stipulated and agreed that the $80,000 in value of said stock or assets of said corporation should be divided into 800 portions or shares, each share representing and being of the value of $100. The articles of association when executed became and was a contract between plaintiff and the other shareholders and the corporation that plaintiff was the owner of and entitled to 150 of said shares, of the face or par value of $15,000, and in the absence of agreement or understanding, qualifying facts...

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22 cases
  • Ambruster v. Ambruster
    • United States
    • Missouri Supreme Court
    • September 4, 1930
    ...be issued to him. The title to the shares may exist without the certificate, the latter being only evidence of such title. Williams v. Everett, 200 S.W. 1045; Business Men's Association v. Williams, 137 Mo. App. 575, 588; Vanstone v. Goodwin, 42 Mo. App. 39. (7) The trial court erred in per......
  • Ambruster v. Ambruster
    • United States
    • Missouri Supreme Court
    • September 4, 1930
    ...of one does not prevent another who is the equitable or beneficial owner of said stock from showing that he is the real owner. Williams v. Everett, 200 S.W. 1045. (a) Ambruster and Edith Ambruster owned the stock of defendant corporation as tenants by the entirety, and estates by the entire......
  • Sims v. Missouri State Life Ins. Co.
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    ... ... theretofore been made, and which was complete without the ... issuance of the certificate. Williams v. Everett, ... 200 S.W. 1045. (4) In the designation of a beneficiary in an ... insurance contract, the words "his wife" are ... surplusage when ... ...
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    ...pleaded in defendant's amended answer. Cape Girardeau Term. Railroad Co. v. St. L. & Gulf Ry. Co., 222 Mo. 461, 121 S.W. 300; Williams v. Everett, 200 S.W. 1045; Wilkinson v. Lieberman, 327 Mo. 420, 37 S.W.2d Took v. Wells, 331 Mo. 249, 53 S.W.2d 389; St. Louis Perfection Tire Co. v. McKinn......
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